Disaster Recovery Demands Drive Axcient Growth

Axcient, the developer of business continuity and disaster recovery solutions sold through MSPs, reported 20% year-over-year revenue growth in the first quarter. Quarterly bookings also grew 48% — Axcient is calling that a record.

Axcient’s Rod Mathews

Rod Mathews, who took over as CEO last October after a nine-year stint at Barracuda, attributes the growth to a number of factors. General market demand for business continuity and disaster recovery (BCDR) was one. Another was Axcient’s five-year effort to build out its disaster recovery product as a service that can be combined with backup and sold at a competitive price.

“That whole vision has really come together over the last six months to a year,” he said. “Part of it is our road map landed in the right time.”

Axcient also raised its prices, the first time in its history. The increase, which came as many MSPs and other vendors did the same, contributed in part to the first-quarter growth, Mathews said.

Recent consolidation of some of the big BCDR vendors also caused some MSPs to seek a new partner.

“That’s driven people to look for other alternatives. MSPs look at the products they’re using and they realize that they’re either too expensive or too complex, or they have too many of them to be able to effectively run their business,” he said. “They start looking for a consolidation point. We typically wind up being either chosen or in the hunt to be that consolidation point.”

There’s another side of consolidation Mathews believes has helped Axcient. A study the company conducted last fall with 300 MSPs found that each worked with an average of three BCDR vendors, while 25% of those had four. Given the talent shortage in the IT industry, the musical chairs many employees play, and the consolidation of MSPs, it’s much easier to train someone on one system, he said.

Axcient’s recent pricing and configuration of its products has also helped MSPs improve profitability and run their businesses more efficiently, Mathews said. A server license for storage, for example, includes all the storage needed to back data up locally and replicate it to Axcient’s cloud.

“Not having per terabyte or per gigabyte storage pricing that people have to plan for and try to predict just makes it easier,” Mathews said. “It’s essentially one or two SKUs that people have to acquire to deploy the product.”

Axcient also has month-to-month contracts with its partners, rather than some of the longer contracts big vendors use to lock in MSPs.

“It keeps our customers happy,” he said. “We try to focus on which partners may be having issues and how we make sure we’re doing all the right things to earn that business.”

Disaster Recovery Demands Continue to Grow

The increasing importance of BCDR solutions also helped to drive first-quarter sales and bookings. About 75% of MSPs in the Axcient survey said BCDR was extremely important to their business and represented about one-third of their revenue.

“It’s a big number that will continue to grow,” Mathews said. “Ransomware is not going away. Natural disasters will keep happening. Those things cause people to make sure their infrastructure is protected.”

During the first quarter, Axcient also refreshed its product line. That included releasing its x360 Recover’s Linux agent for Ubuntu and Debian systems, expanding Auto Verify for x360Recover Direct-to-Cloud, redesigning the x360Portal for easier navigation, and tweaking X360Recover Manager to reduce loading times by up to 20 times in some cases.

“We’ve done a really good job of understanding our customers and understanding where we can help them grow, which has driven organic growth,” Mathews said.